Grad Money Matters

10 Simple Steps to Improving Your Credit Score

(This is a guest article by Mike Acheson*)

Most financial institutions use credit scores to help decide whether to lend you money or not. It is very important to have a good credit score if you are looking to apply for a personal loan, credit card, or a mortgage. It can be the single determining factor for many banks and credit card companies.

In the US, the average credit score is somewhere around 650-675 but most banks consider anything above 700 to be a good score. Luckily, there are a few simple steps you can take to improve your credit score.

The first step is to search the Internet to find a free credit report - there are a number of websites that offer this service such as Equifax and Experian.

After you have your report, follow these 10 easy steps to improve your credit score:

Learn how to read your report – It’s important to know how to read the report and to ensure you have accurate information about your starting score. After you have a clear idea of where you’re starting from, you can improve your score from there. Some people already have a good score and don’t need to make any improvements.

Find errors – While reviewing your report, make sure to take note of all your applications for credit and to ensure they are accurate. If there is information that doesn’t belong to you or if there are any other errors make note of this.

Addressing the errors – Once you identify a problem you will want to notify the major credit report companies immediately to get them to amend your report. By law, they are required to look into your claims within a month. If the information you provided is correct they will change your report to address any concerns you had.

Pay any overdue bills – It is important to pay all your missed loan repayments or any bills you may have from an overdrawn credit card. This is crucial. After these bills have been paid, not only will your credit report improve but also you will have the satisfaction of having paid these outstanding bills.

Communicate with your creditors – Contact your creditors after sending your payments so that they can update your information immediately – otherwise it can take a few weeks.

Stop relying on credit – Taking on credit is a dangerous path for most people – your debts can spiral out of control quite easily. If you’re trying to improve your credit score then don’t take out any more credit. It’s as simple as that. Credit cards and loans will only make the problem worse.

Ask about payment plans – Many creditors accept payment plans with their debtors. The main purpose is to allow you to catch up on your remaining bills but it also helps you gain control of your finances and to create good spending practices. Living within a budget can be a rewarding challenge.

Adjusting the frequency of your payments – When paying back debts, divide your monthly payments into weekly or twice-weekly payments. This will make your bank records show that you have made extra voluntary payments. The computers will register extra payments, which can increase your credit score significantly. This method of repayment also helps you not fall behind on your payments in the future. If you pay off all your debt then you wont have to worry about any of this.

Self-Debt Management – It’s likely that a debt management company will take a lot of your money but you can often set up your own plan to help pay back your debt. Search the Internet for do-it-yourself debt management strategies and start budgeting. With a little hard work you can pay off your debt in no time and have a sparkling credit report. It’s not easy but it can be done.

Don’t be tricked – A lot of companies and websites promise instant credit repairs and improvements but they are often trying to take advantage of you.

The best thing you can do is work on your credit score at a pace that works for you. You might not be able to make all your payments right away but chip away at your payments and you will see your credit score improve – all it takes is hard work and a little foresight. Good luck.

*About the author: This post was written by Mike Acheson, who writes about debt and life cover in Canada.

*Image Credit: Photograph by kevinzhengli [via Flickr Creative Commons]

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5 Ways to Lower Your Auto Insurance Premiums

(This is a guest article*)
With auto insurance being mandatory for all drivers, simply canceling coverage is out of the question. But paying for premiums that could be lower when you’re just starting to make some dough isn’t smart either, especially since student loans and other expenses loom. Auto insurance premiums can be especially daunting if your parents were taking care of them while you were in school. Fortunately, there is hope for the struggling grad and you may be able to hold on to more of your hard-earned cash.

Do smart comparison shopping

Look for multi-policy, and other discounts

Limit coverage on older cars

Raise your deductible

Maintain a clean driving record

*About the author: This article was written by NetQuote. NetQuote provides low-cost leads from most of the major insurance providers in the auto insurance industry.

*Image Credit: Photograph by net_efekt [via Flickr Creative Commons]

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15 Free Online Accounting Courses for Self-Learners

(This is a guest article by Karen Schweitzer*)

Getting a quality education in accounting doesn't have to mean spending several months in a classroom and several thousand on tuition. There are many free online courses that allow you to learn in your spare time and at your own pace. Here is a list of 15 free online accounting courses from top-notch colleges, universities, and educational institutions:

Financial Accounting - The Massachusetts Institute of Technology (MIT) provides a variety of free courses for self-learners including this Financial Accounting course. The free online course features 19 lectures in PDF format as well as other study materials.

Introduction to Accounting - This course from the U.S. Small Business Administration (SBA) features an introduction to accounting. Students taking this course can gain a basic understanding of accounting and learn how to keep accurate books and financial statements.

Influences on Accounting Regulation - The Open University offers a six-hour masters course that discusses the national practice of financial reporting in the UK. The course is broken up into two sections, the evolution of regulation and jurisdiction rules.

The Accounting Process - This NetMBA course provides an overview of the accounting cycle. The course covers everything from beginning transactions to closing books.

Managerial Economics - This Utah State University course discusses the essential principles of managerial economics. The course's 17 weeks of lecture notes are presented in audio format.

Accounting for Advanced Accruals - SimpleStudies.com provides this online accounting course that explains accounts receivable and notes payable. Along with courses, this site also provides online exercises and an accounting dictionary.

Management Accounting and Control - This free MIT course provides an introduction to accounting information, performance, and control. The course is intended for those looking to become management consultants.

Principles of Financial Accounting - The University of Alaska offers this free accounting course to give students an understanding of accounting principles and terms. The course is presented through slide presentations, assignments, and practice exams.

Fundamentals of Personal Financial Planning - This eight-module course in financial planning from the University of California-Irvine introduces students to the principles of accounting, investing, and taxation.

How to Prepare a Loan Package - This SBA course, which is the first in a series of online training courses for aspiring accountants and entrepreneurs, provides an in-depth look into creating and understanding a loan package. Upon completion of this self-paced course, learners receive a Certificate of Completion from the Small Business Administration.

Introduction to Strategic Management - Capilano University features this 15-week course to provide self-learners with an understanding of business analysis and business management. Course materials include presentations and assignments.

Introduction to Microeconomics - This Utah State University course focuses on the fundamentals of economics in the marketplace. Course offerings include fifteen assignments and four examinations.

Introduction to the Context of Accounting - This course from The Open University offers an overview of accounting and its origins. The four-hour advanced course provides learners with a clear idea of what accounting really means.

Taxes and Business Strategies - Students who take this free online accounting course from MIT will study tax planning and tax strategy for businesses. The course provides PDF lecture notes, assignments, and other downloadable course materials.

*About the author:Guest post from education writer Karen Schweitzer. Karen is the About.com Guide to Business School. She also writes about online classes for OnlineClasses.org.

*Image Credit: Photograph by laurenmarek [via Flickr Creative Commons]

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7 Easy Ways to Save on Healthcare

(This is a guest article by Mary Ward*)

Healthcare costs are among one of today’s hottest topics. And, one thing that’s not up for debate is the fact that, whether you have employer provided healthcare or you’re paying for it on your own, costs have risen dramatically in the last few years. In fact, costs have risen so dramatically that many small businesses have had to cut health insurance for their employees, or at least reduce the benefits they pay for, and new businesses have difficulty adding this benefit for their workers. More people are paying for their own healthcare insurance than ever before. But, there are a few things you can do to reduce your healthcare costs under nearly any insurance plan.

Get a healthcare spending account – Healthcare spending accounts, sometimes called flexible spending accounts, allow you to have money taken from your paycheck on a pre-tax basis to go into an account to pay for out of pocket healthcare expenses. Because the money comes out pre-tax, you save tax dollars on anything you spend on healthcare in a year. You can use this money to pay co-pays and doctor bills as well as for prescriptions and over the counter medications. One drawback to these accounts is that any money you don’t spend during the calendar year is lost. So, be certain not to put too much into the account. And, as the year draws to a close, be certain that you’ve submitted all pertinent receipts for reimbursement.

Get healthy – Your healthcare costs over your lifetime will be less if you stay healthy. So, lose weight if you need to and quit smoking. In addition, don’t neglect preventative screenings like checkups, as these can help you catch any issues early on. In addition, some employers today are offering cash incentives to employees who meet certain health criteria. In the future, expect to see higher insurance premiums for people who are more at risk for disease, such as smokers and those who are obese. There’s no question that, over the next few years, the healthiest people will get the best insurance rates.

Switch to a "high deductible" plan – If you’re relatively healthy, a high deductible plan may save money over the long run. In such plans, you receive insurance negotiated rates for services and pay very low premiums. However, rather than co-pays you pay for each doctor visit at the negotiated rate. A healthcare account can be established for you (and sometimes your employer) to deposit money for paying your medical bills. There are two primary advantages to these plans. The first is that, in most cases, preventative procedures are free. This feature saves you hundreds of dollars each year and removes any excuses for not getting routine checkups and testing performed. The second is that the money in your healthcare account bears interest and rolls over from year to year. So, if you can stay healthy for a few years, you’ll have money built up when a big medical expense comes along.

Tweak your options – Similar to the above, even small changes to things like office visits, emergency room, and prescription co-pays can make a sizable difference in your premium. If you are willing to pay slightly higher co-pays, you may find an advantageous trade-off in the form of your premium. Just be sure to work the numbers so that the co-pays don't end up costing you as much as the premium savings. Also, ask about other features that could benefit your wallet, such as free (no co-pay) annual exams and discounts on eye care or dentistry.

Working the Network – Depending on your provider and plan, you may have lower-cost yet still quality options for using in-network providers for much lower premiums and co-pays. Talk to health plans to see if something like this can work for you, but realize that it often means switching your care provider; that's a benefit you'll have to weigh out.

Use those benefits! Many plans offer reimbursements and vouchers for things like gym memberships, weight loss plans, children's activities, and more. Often, these are things you are paying for anyway, not to mention that they are designed to get you healthier (see number 2) so be sure to take advantage of these programs—a few minutes filing an application really can add up to hundreds in savings.

Shop around – It’s not usually a wise idea to simply renew health insurance coverage each year without evaluating your options. If you haven’t shopped around for healthcare insurance in a few years, now is the time. Even if it means just evaluating a second option your employer may offer, it could pay to make a switch. Be sure to check with the company providing your auto insurance, too. They often have health insurance plans, and with a multi-line discount, may offer a very attractive policy. Never assume that your employer’s plan offers the best deal. Unions and other professional organizations may offer discount health insurance policies, too.

Healthcare and medical insurance are very volatile subjects in the US right now. We can only hope that all the discussion will lead us to more options and more affordable options for everyone. In the meantime, however, don’t forget to look at ways to save money on your current plan, as well as evaluating that plan to see if it still works for you or if another plan can save you money. We all need healthcare insurance; we just don’t need to go broke trying to get it.

*About the author: Mary Ward is a freelance writer and likes writing about healthcare career topics, such as how to obtain an online x-ray tech degree.

*Image Credit: Photograph by Badly Drawn Dad [via Flickr Creative Commons]

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7 Don’ts for Fiscal Freshmen

(This is a guest article by Jack Busch*)

As a student, your financial picture is a bit unique. You have few assets and few hours to devote to a job, thus little income. You have little credit history (good or bad) but some limited access to revolving credit and other loans. Because of this, the years between matriculation and graduation are somewhat of a testing ground for your creditworthiness. Lenders give students just enough rope to hang themselves – and during those crucial four or so years, you can either establish a firm foothold on your way up to excellent lifelong credit or scar your credit rating for life with poor decisions. But by being an early adopter of responsible spending habits, you can save yourself from a lifetime of debt and sorrow. Your continued fiscal auspiciousness should be dictated by a series of don’ts. For example:

Don’t carry a balance.

If you have to use that emergency credit card, make sure you get it paid off ASAP. If that means no pizza or beer for a week, then so be it. If it means borrowing $50 from your pop, then do it. Believe me – it’s worth it to miss out on that one wild night in order to avoid the never-ending downward spiral of credit card debt. As long as you don’t flunk out, there’ll be plenty more wild nights to come. But that credit card debt will last far longer than a hangover if you let it get out of hand.

Don’t open multiple accounts.

If you’ve gone ahead and ignored the first don’t and maxed out your credit card, then don’t make things worse by getting another credit card. Instead, focus on paying down your current debt or, as a last resort, transfer your balance to a 0% interest card, such as the Discover More Card (but watch out for those fees!). I’m actually a bit hesitant to recommend the latter route, since two cards are always tougher to pay off than one, and you likely won’t qualify for a favorable credit with high debt to credit ratio. Opening another credit card count when cash is tight is akin to drilling a hole in a sinking boat to let the water out. It just doesn’t make sense.

If things are truly dire, you may want to consider credit counseling or a debt consolidation loan. But both of these open routes open an entirely different can of worms – do so with caution.

Don’t spend your salary before you’ve got it.

Yes, I know, you think you’re going to be a wheelin’ dealin’ lawyer or a snazzy corporate consultant when you graduate. But don’t bank on that bestselling novel or big banker’s bonus to pay for your credit card debt in college. First of all, your lucrative career is going to be four years down the road (or more, if the job market stinks) which gives all that debt plenty of time to accumulate interest. Plus, you’ll have an entirely new set of expenses once you’re living the urban professional lifestyle. Going into the post-grad world with a bunch of undergrad debt is like going straight from being a student to being a parent. Except that lousy ungrateful kid you’re paying for is yourself.

Don’t use your credit card to its full extent.

Ever notice how your car’s speedometer goes up to something like 140 miles per hour? Ever notice how driving that fast will get you killed or arrested? Your credit card is the same way. There are lots of neat features that come with your credit card, such as cash advance, convenience checks and deferred interest. But don’t use them and don’t use up all of your credit line. Cash advance (i.e. getting cash from an ATM using your credit card) comes with an astronomically higher interest rate and can’t be paid off until the rest of your balance is paid off. That means that $60 you pulled out can actually end up costing you twice that much in the long run. Use your credit card only for emergencies or only to rack up points, cashback and rewards and then pay it off in full each month.

Don’t forget to check your statement.

You’re already checking Facebook every 24 minutes, why not bookmark your bank’s website while you’re at it? Knowing what you’re spending and how much you’ve got to spend will save you from overdraft charges, over-the-limit fees, late fees and other unpleasant surprises. If that’s too boring for you, there are plenty of flashy tools that you can use to track your finances, such as Mint, Thrive and Wesabe.

Don’t let your parents write the check.

To get the full gravity of how much everything is costing you, arrange your finances so that the money for tuition, room and board, etc. comes out of your account. This can be necessary for tax purposes but it also instills a sense of how much everything is costing and how money should be budgeted.

When I was in college, my grandparents paid for much of my expenses. But instead of cutting the school a check whenever money was due, they just plunked all the money I was going to get from them into my checking account on day one. It was a daunting sum of cash to see on my bank statement, but I knew that if I blew it all, it’d be the end of my education. I was in charge of writing my rent check each month and arranging payments with the school’s registrar to make sure I was still signed up each semester and it taught me a lot about handling vital finances.

Of course, you don’t have to go it alone completely. It’s not a bad idea to become an authorized user on one of their credit cards strictly for emergencies. Especially since the credit cards for college students offered (for a limited time) on campus can often be riddled with pitfalls and traps designed to extract money from the uninitiated.

Don’t let your spending outstrip your income.

This is a pretty simple one. If you have no job, then you have no income. This should make budgeting easy. If all you have is some money you received as a gift for your high school graduation and a check for your birthday and Christmas, then it should be pretty easy to calculate how much you can spend before you’re broke. If this kind of lifestyle feels restricting, then get a part time job. Donate plasma. Wash dishes in the cafeteria or get a work-study position through the school. You can party all you want as long as you subsidize the expenses.

This last don’t is important , and if you can’t remember anything else from this article, remember this: don’t live beyond your means. Follow that one rule and you’ll be fine.

Let college be the time in your life when you forge a healthy relationship with credit. Because once you get out and payments on your student and federal loans become due and it comes time to finance a house, a car and a family, the rules will stay the same but stakes get much higher. Master these guidelines today and thank yourself for sidestepping crippling debt tomorrow.

*About the author: Jack blogs about personal finance, credit cards and debt management at Master Your Card and DebtLoans.com.au.

*Image Credit: Photograph by RBerteig [via Flickr Creative Commons]

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5 Ways Parents Can Help Reduce Student Debt

(This is a guest article by Gary Foss*)

Often when a child leaves to enter further education, they will not have had to budget or manage their own money before. This can be quite a shock to the system and some young adults will deal with this more responsibly then others. Unfortunately, some will leave with considerably more debt than others. In many cases, this will be because the temptations of having money are all too much.

Many parents may not be able to help their children by providing money and helping to pay for their education and, for this reason, there is a lot that parents can do to help build their child’s financial independence before they leave.

1) Teach Them to Become Financially Independent

One of the best things that you can do is to encourage your child to save their money from an early age and to see and enjoy the benefits of saving. Often this will also result in the child feeling less inclined to spend their money in one go or on items that they do not really need.

It can be a good idea to encourage your child to have a small job when they are old enough, as again, this teaches them responsibility for their own money. It will also further reinforce the idea of saving and hopefully they will take pride in being able to manage their finances independently.

2) Point them in the right direction to fund their education

There are a number of ways to find money for education these days. Help your son or daughter identify these avenues:

a) Student Loans

b) Scholorships & Bursaries

c) Family Assistance

d) Commerical debt

3) Help them stay on top of their finance

You may also find that suggesting they keep track of all their income and expenses will teach them how to budget their money, which is an essential skill for the future. Once your child has begun full-time education it is advisable to sit with them and establish some form of budget.

This could be simply working out how much money they have per week and then taking out only this amount from the cash machine to avoid overspending. Something like this can really make a difference to how much debt they will have when they eventually leave. You should also advise against obtaining store and credit cards as these can provide too much temptation and cause them to accumulate debt.

4) Encourage them to get a part-time job

Some students don’t have the time or the energy to pick up a part time job on top of their studies but many can and should. If it’s possible, encourage your children to get a part-time job or even a full-time job during the summer vacation from school.

A job will give them a chance to earn a bit of money to go towards their education but it will also give them a sense of how much things actually cost. A student that never works doesn’t understand the costs of their education and the things that come along with it (Ie. housing, food, clothing etc.)

5) Help them if they’re having trouble

Lastly, you should always encourage your child to talk to either yourself or someone in a relevant department at their University or college if they do find they are struggling with their finances. Often, students will struggle on and get themselves into even more debt because they did not want to admit that they could not cope.

You might also need to bail them out by lending them money to cover their education debts – you obviously want your child to be able to stand on their own two feet but sometimes they might need your help to save them from financial disaster.

*About the author: This is a guest article by Gary Foss from SIPPS.org.uk - personal pension and finance specialists.

*Image Credit: Photograph by upsuportsmouth [via Flickr Creative Commons]

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